What is a reasonable offer to settle under s. 37.1(2) of the Manitoba Human Rights Code?

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Article2021 | 01 | 25

What is a reasonable offer to settle under s. 37.1(2) of the Manitoba Human Rights Code?

After a complainant files a human rights complaint with the Manitoba Human Rights Commission (“Commission”), the respondent may file a reply. The Commission may attempt to resolve the complaint through mediation or other means at any time.

As soon as is reasonably possible after a complaint has been filed, the complaint will be investigated.[1] The investigator makes a recommendation to the Board of Commissioners (the “Board”) about whether or not there is sufficient evidence to support the alleged contravention of The Human Rights Code, CCSM c H175 (the “Code“). The Board then decides if the complaint should be dismissed or referred to a public adjudication hearing.[2] If referred to a hearing, the Commission will usually offer the parties another opportunity to try and resolve the complaint before it requests that an adjudicator be appointed.

A respondent may ask the Commission or an adjudicator to assess the reasonableness of an offer made to a complainant. Whether the Commission or an adjudicator assesses the offer depends on the stage of the complaint. If an adjudicator has not yet been appointed, the Commission will assess the offer. If an adjudicator has been appointed, an adjudicator will assess the offer.

Reasonable Offer Provisions

If a complainant rejects a settlement offer that the Commission considers reasonable, the Commission must terminate the proceedings (the Code, s. 24.1(4)). If the proceedings are terminated, the complaint will not be heard by an adjudicator, and, if the offer is made early enough, will not be investigated.[3]

Similarly, if a complainant rejects a settlement offer that an adjudicator considers reasonable, the adjudicator must terminate the adjudication (the Code, s. 37.1(2)). As only decisions under s. 37.1(2) are reported publicly, this article focusses on decisions under that provision rather than decisions under s. 24.1(4).

These reasonable offer provisions are important for respondents who want to avoid the costs of a hearing, whether they accept the merits of a complaint or not. Unlike normal settlement negotiations, the respondent need not rely on the complainant to accept the offer to avoid a hearing. The very fact that the offer itself is reasonable can terminate the proceedings irrespective of the complainant’s view of the offer.

Notably, Bill 26, The Human Rights Code Amendment Act, (passed first reading on October 14, 2020) if enacted, would slightly modify the above provisions. Under the amendments, if a respondent makes a settlement offer before an adjudicator is appointed to hear a complaint, the executive director must determine if the offer is reasonable, rather than the Commission. Similar to the Commission, the executive director must terminate the proceedings if the complainant rejects an offer the executive director considers reasonable. The complainant may then apply to the Commission for a review of the executive director’s decision to terminate proceedings. If the executive director does not find the offer to be reasonable, it does not appear a respondent can appeal that decision under the proposed amendments. However, it appears the respondent may still make an offer again after an adjudicator has been appointed to hear a complaint but before the hearing, in which case an adjudicator would determine if the offer is reasonable in a manner similarly provided for under the current legislation.

Purpose

The purpose of s. 37.1 is to “avoid an expensive hearing on the merits in situations where the Respondent has made an offer that reasonably approximates a remedy an adjudicator would have ordered if the complaint were proven.”[4]

What can be considered in assessing an offer?

 The starting point under s. 37.1 is the offer itself. Beyond this, the Code provides little guidance on what adjudicators can actually consider.[5] Based on the cases decided under s. 37.1, it appears the adjudicator may consider the complaint and the offer, but not necessarily the reply, correspondence, counteroffers, or witness statements.[6]  It appears adjudicators may consider any admissions and agreed statements of facts.[7]

Adjudicators have determined that they ought to approach the offer on the basis that the allegations as set out in the complaint are proven.[8] However, this does not mean that the adjudicator has to consider every single statement made in the complaint. Rather, the “adjudicator simply needs to accept that the Code has been contravened in the manner alleged in the complaint.”[9] While some adjudicators have held that an adjudicator performing an analysis under s. 37.1 cannot weigh evidence or make findings of fact, that is not apparent from the Code.[10]

The Code provides adjudicators broad powers, including the power to summon witnesses, inspect premises, and rely on the services of experts.[11] Although most adjudicators have taken a limited approach in regards to what can be considered in determining the reasonableness of an offer, there is nothing in the Code to suggest this is required, or that an adjudicator in the future may not be open to hearing evidence when determining if an offer is reasonable under s. 37.1. After all, the Manitoba Court of Queen’s Bench has held that the legislature intended adjudicators to be given broad discretion to determine what constitutes a reasonable offer and the process to do so.[12]

The considerations under s. 24.1(4) of the Code may be slightly different than those under s. 37.1(2), depending on the approach taken by the adjudicator. Manitoba Human Rights Commission Policy #I-2 states that if the offer is made after the complaint has been investigated (but before an adjudicator is appointed), the Board will review the evidence in the Investigation Assessment Report (“IAR”) and any other evidence submitted by either party in their response to the IAR.[13]

What constitutes a reasonable offer under s. 37.1?

The case law is clear that consideration will be given to the totality of the offer. As provided by Adjudicator Manning in Nash v Natividad, a reasonable offer is:

one that approximates, or is the same as, the relief that an adjudicator would allow order (sic) if the complaint were proven at a hearing. However, an approximation does not mean that a reasonable settlement offer must necessarily mirror exactly what an adjudicator would order after finding that the complaint had been proven [citations omitted].[14]

To be reasonable, the settlement offer must address each of the five remedial headings under s. 43(2) of the Code.[15] A settlement offer that only takes into account some of the applicable remedies is not reasonable.[16] However, the failure of an offer to address issues such as a letters of reference or additional financial compensation for out of pocket expenses does not necessarily make the offer unreasonable. The offer must be considered as a whole.[17]

The remedial headings under section 43(2) of the Code are as follows:

  • do or refrain from doing anything in order to secure compliance with this Code, to rectify any circumstance caused by the contravention, or to make just amends for the contravention;
  • compensate any party adversely affected by the contravention for any financial losses sustained, expenses incurred or benefits lost by reason of the contravention, or for such portion of those losses, expenses or benefits as the adjudicator considers just and appropriate;
  • pay any party adversely affected by the contravention damages in such amount as the adjudicator considers just and appropriate for injury to dignity, feelings or self-respect;
  • pay any party adversely affected by the contravention a penalty or exemplary damages in such amount, subject to subsection (3), as the adjudicator considers just and appropriate as punishment for any malice or recklessness involved in the contravention;
  • adopt and implement an affirmative action program or other special program of the type referred to in clause 11(b), if the evidence at the hearing has disclosed that the party engaged in a pattern or practice of contravening this Code.

 

Components of offers found to be reasonable

  Koshinsky v Winnipeg Folk Festival, 2019 MBHR 11 (CanLII) Collette v St. Adolphe Personal Care Home Inc, 2015 MBHR 4 (CanLII) Mousseau v Southern Health, 2019 MBHR 8 (CanLII) Metaser v Jewish Community Campus of Winnipeg Inc., 2013 CanLII 61017 (MB HRC) Nash v Flora Natividad, 2019 MBHR 4 (CanLII)
Apology / Acknowledgment Apology Acknowledgement and apology None None None
Damages for injury to dignity, feelings, or self-respect $20,000 $8,000 None – damages under s. 43(2)(c) cannot be awarded to estate $5,250 $8,000
Compensation for financial losses, expenses incurred, or lost benefits 18 months’ wages 1 year wages $1,000 None None
Penalty or exemplary damages None None None None None
References Letter of reference/response to inquiries consistent with letter None N/A None N/A
Policy Changes (ensuring future compliance) Review accommodation-related policy in consultation with legal counsel. Undertake whatever policy and practice review and update as required with legal counsel. Update orientation to include reference to political beliefs. Respondent already revised policy manual. Review and, if necessary, revise policies, processes and training and implement said changes.
Training (ensuring future compliance) Ensure employees involved in human resources made aware of policy. Chair of respondent board of directors, and employees involved in making decisions re accommodation, required to attend Commission seminar. Appropriate high level management participate in training offered by Commission if need be. Human rights training for staff involved in the orientation/ hiring process. Respondent already sent key staff to Commission workshops and other employees viewed relevant video-recordings of the Commission. See above.
Affirmative action or special program None None None None None
Release Full and final release Standard release Not addressed Release limited to human rights complaint Full and final release
Other 2 weekend passes to Folk Fest None None None None

 

Cases Where Offer Not Reasonable

An offer may not be reasonable where the general damages are not proportionate to the alleged wrong. For example, in Nachuk v City of Brandon, Adjudicator Manning found that the complainant, an individual who relied on a service animal, was particularly vulnerable when the respondent (police officers) escorted him out of a public premise.[18] Adjudicator Manning noted Manitobans expect police to uphold, not transgress, the Code and as such, general damages of $5,500 failed to reasonably approximate what an adjudicator would award.[19]

An offer may also not be reasonable where the adjudicator does not have enough information to determine if the offer is reasonable. For example, in Damianakos v University of Manitoba, Adjudicator Walsh, as she then was, found that having accepted that the complainant suffered discrimination, it was not reasonable to conclude that an adjudicator would not have ordered an award under s. 43(2)(a) (do or refrain from doing anything).[20] Further, Adjudicator Walsh did not have sufficient information regarding benefits and salary increments to determine if the offer was reasonable with respect to s. 43(2)(b) (financial losses, benefits lost).[21]

Adjudicator Harrison found a respondent’s “all inclusive $4,000” offer to not be reasonable in Mancusi v 5811725 Manitoba Inc (Grace Cafe City Hall).[22] While $4,000 might have fallen within the range the complainant might expect to get under s. 43(2)(c), Adjudicator Harrison was not satisfied that the offer adequately addressed section 43(2)(b) of the Code (financial losses sustained, expenses incurred or benefits lost).

Where a complainant can make a case, supported by evidence, for a significantly higher amount of compensation than the amount in the offer, an adjudicator may decline to find the offer reasonable. In Young v Amsted Canada Inc., Adjudicator Sim found the complainant made a reasonable enough argument that he should be allowed the opportunity to present it at a hearing.[23]

Takeaways

 Respondents can use the reasonable offer provisions of the Code to avoid potentially expensive hearing costs. If an adjudicator has not yet been appointed, the respondent can ask the Commission to assess the reasonableness of the offer. If an adjudicator has been appointed, the respondent can ask an adjudicator to consider the reasonableness of the offer. In either case, if the Commission/adjudicator considers the offer to be reasonable, the proceedings must be terminated.

When making an offer, respondents ought to ensure all remedial headings under s. 43(2) of the Code are addressed. Based on the cases decided under s. 37.1, it appears an adjudicator may only consider the complaint and the offer when assessing whether the offer is reasonable, however, the broad powers under the Code suggest an adjudicator may be open to hearing evidence when determining if an offer is reasonable. Regardless, it appears clear that an adjudicator will assume a breach of the Code has taken place. The Commission in assessing the reasonableness of an offer may consider the Investigation Assessment Report (“IAR”) if the complaint has been investigated and submissions in response to the IAR in addition to the offer, complaint and reply. These factors ought to be kept in mind when respondents consider when to make an offer and what to include in an offer.

 Appendix

The Human Rights Code, CCSM c H175

Failure to accept reasonable settlement offer

24.1(4)

If a complainant rejects a settlement offer made by the respondent before an adjudicator is appointed to hear the complaint, the Commission must terminate its proceedings in respect of the complaint if the Commission considers the offer to be reasonable.

General powers of adjudicator

37

For purposes of exercising his or her responsibilities under this Code, an adjudicator has the powers, privileges and immunities of a commissioner appointed under Part V of The Manitoba Evidence Act.

Adjudicator to determine reasonableness of offer

37.1(1)

When a settlement offer is made after an adjudicator is appointed to hear the complaint, the chief adjudicator must designate a different member of the adjudication panel to determine if the settlement offer is reasonable.

Failure to accept reasonable settlement offer

37.1(2)

If a complainant rejects a settlement offer that the adjudicator designated under subsection (1) considers to be reasonable, that adjudicator must terminate the adjudication to the extent that it relates to the parties to the settlement offer.

 General procedures at hearing

39(2)

Subject to this Code and the regulations, the adjudicator may determine the procedures to be used at the hearing and may receive at the hearing such evidence or other information as the adjudicator considers relevant and appropriate, whether or not the evidence is given under oath or affirmation and whether or not it would be admissible in a court of law, unless the evidence is subject to any type of legal privilege.

 

[1] The Human Rights Code, CCSM c H175, s 26.

[2] http://www.manitobahumanrights.ca/v1/complaints/complaints-guides-pages/guide-investigation.html.

[3] http://www.manitobahumanrights.ca/v1/complaints/complaints-reasonable-settlement-offers.html.

[4] Mousseau v Southern Health, 2019 MBHR 8 (CanLII) at para 9; Nachuk v City of Brandon, 2014 CanLII 20644 (MB HRC) at para 30; Metaser v Jewish Community Campus of Winnipeg Inc, 2013 CanLII 61017 (MB HRC) at para 11.

[5] Nash v Natividad, 2019 MBHR 4 (CanLII), at para 21.

[6] Damianakos v University of Manitoba, 2015 CanLII 11275 (MB HRC) at para 48; Nash v Natividad, 2019 MBHR 4 (CanLII) at para 23, Nachuk v City of Brandon, 2014 CanLII 20644 (MB HRC) at para 28.

[7] Nash v Natividad, 2019 MBHR 4 (CanLII) at para 21.

[8] Ibid.

[9] Damianakos v University of Manitoba, 2015 CanLII 11275 (MB HRC) at para 35.

[10] Ibid at para 45.

[11] The Human Rights Code, CCSM c H175, s. 37; The Manitoba Evidence Act, CCSM c E150, Part V.

[12] Manitoba Human Rights Commission and Metaser v Jewish Community Campus of Winnipeg Inc., 2015 MBQB 47 at para 29.

[13] http://www.manitobahumanrights.ca/v1/education-resources/resources/policies-pages/policies-i-2.html.

[14] Nash v Natividad, 2019 MBHR 4 (CanLII), at para 25.

[15] Ibid at para 27.

[16] Nash v Natividad, 2019 MBHR 4 (CanLII) at para 27, Metaser v Jewish Community Campus of Winnipeg Inc, 2013 CanLII 61017 (MB HRC) at para 14.

[17] Collette v St. Adolphe Personal Care Home Inc, 2015 MBHR 4 (CanLII) at para 32.

[18] Nachuk v City of Brandon, 2014 CanLII 20644 (MB HRC) at para 37.

[19] Ibid at para 38.

[20] Damianakos v University of Manitoba, 2015 CanLII 11275 (MB HRC) at paras 79, 80.

[21] Ibid at para 100.

[22] 2012 CanLII 73431 (MB HRC).

[23] Young v Amsted Canada Inc., 2015 CanLII 73279 (MB HRC), at paras 29, 30.


DISCLAIMER: This article is presented for informational purposes only. The views expressed are solely the author(s)’ and should not be attributed to any other party, including Taylor McCaffrey LLP. While care is taken to ensure accuracy, before relying upon the information in this article you should seek and be guided by legal advice based on your specific circumstances. The information in this article does not constitute legal advice or solicitation and does not create a solicitor-client relationship. Any unsolicited information sent to the author(s) cannot be considered to be solicitor-client privileged.

If you would like legal advice, kindly contact the author(s) directly or the firm's Managing Partner Norm Snyder at nksnyder@tmlawyers.com, or 204.988.0302.



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Kelby Loeppky
Kelby Loeppky
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